Qualcomm Bids $4.6 Billion for Veoneer as Its New CEO Looks Beyond iPhone
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Qualcomm Inc. has made a $4.6 billion offer to buy auto-technology company Veoneer Inc., moving to outbid Magna International Inc. as the semiconductor company's new chief seeks to expand beyond the core mobile-phone chip business. Chips have become ever more central to modern cars, with roles in everything from automated driving to the electronics that adjust seat position. More recently, driver-assistance features that use computers to help control speed and steering have found their way into a larger share of auto makers' product lineups. Qualcomm said Thursday it bid $37 a share for Veoneer. The offer comes two weeks after the Swedish company agreed to be acquired by Magna International, a Canadian auto-parts supplier, in an all-cash deal. Qualcomm is proposing to pay in cash at an 18.4% premium to the Magna offer. Veoneer, which was spun out of automotive-safety company Autoliv Inc. three years ago, makes sensors such as radar, lidar and camera-based systems that allow computers to take a greater role in driving.
At a high level, the Swiss stock market achieved mini-gains on Thursday. In the process, the leading index SMI reached a new high on a closing price basis. Participants spoke of a summer lull, although the reporting season provided news. The SMI gained 0.2 per cent to 12,200 points. Among the 20 SMI stocks, there were 12 gainers and 7 losers, with 1 share closing unchanged. A total of 25.73 (previously: 26.54) million shares were traded. Among the individual stocks, financials benefited from rising bond yields. UBS rose by 0.4 per cent, Credit Suisse by 1 per cent, Zurich Insurance by 0.7 per cent and Swiss Re by 0.9 per cent. Swisscom rose 1.1 per cent. The telecoms group presented solid second-quarter figures, according to Citigroup. Sales exceeded expectations by 1.8 per cent, EBITDA by 8.9 per cent. Overall, the result benefited from the diminishing negative effects of the Corona pandemic and better cost control. Geberit was unchanged after gains in early trading. Following encouraging results from Villeroy & Boch and Saint-Gobain, Berenberg expects another solid quarter for the sanitary ware manufacturer. The weakest performer in the SMI was Alcon, down 2.2 percent, followed by Nestle (-0.5 percent) and SGS (-0.4 percent).
European equity indices closed higher on Thursday as news of a fall in US jobless claims eased fears of a weakening labour market ahead of the monthly jobs report in the US. The Stoxx Europe 600 index gained 0.4% to 470 points. In Paris, the CAC 40 rose 0.5% and the SBF 120 0.6%. In Frankfurt, the DAX 30 gained 0.3%, while the UK's FTSE 100 gave up 0.1%. The Bank of England held its benchmark interest rate steady and stuck to its bond-buying schedule, the latest sign of caution among major central banks as the global economy recovers from the coronavirus pandemic. The BOE said it expects annual inflation to rise to twice its 2% target this year but that the pickup in price-growth will prove temporary, echoing the view of the Federal Reserve that a recent surge in U.S. inflation will fade. Shares in Bayer AG fell in early trading Thursday after the company posted a second-quarter net loss and an outlook on Ebitda before special items which is behind consensus. Bayer posted a net loss of 2.34 billion euros ($2.77 billion) for the quarter compared with a loss of EUR9.55 billion for the same quarter the previous year, missing a company consensus which saw it posting a net profit of EUR793 million. Adjusted Ebitda fell to EUR2.58 billion from EUR2.88 billion the year prior, and that means it was 10% below expectations, according to a trader. The quarterly loss wasn’t expected either, according to the trader, who sees the German company’s results as weak.
Stocks rallied broadly on Thursday, as shares of banks and technology and travel companies rose. The S&P 500 gained 26.44 points, or 0.6%, to finish at 4429.10, rebounding after the broad market index closed down 0.5% on Wednesday. The Dow Jones Industrial Average added 271.58 points, or 0.8%, to end at 35064.25. The technology-heavy Nasdaq Composite rose 114.58 points, or 0.8%, to 14895.12. Both the S&P 500 and the Nasdaq Composite finished at all-time highs, with the broad benchmark index notching its 43rd record close of the year. The Nasdaq Composite has reached 27 records in 2021. The Dow is hovering just 0.2% below its closing high last reached July 26. Robinhood Markets Inc. shares fell 11% Thursday after a filing with the Securities and Exchange Commission indicated that early investors in the company will sell up to about 98 million shares, currently worth around $6.3 billion, over time. The filing names more than a dozen shareholders who bought notes that could be later converted to shares ahead of the company’s initial public offering. Among the selling shareholders are tech private-equity firm Andreessen Horowitz, Iconiq Capital, Institutional Venture Partners and Ribbit Capital. The investing platform operator said it wouldn’t receive the cash from these sales. Exxon Mobil Corp. is considering a pledge to reduce its net carbon emissions to zero by 2050, according to people familiar with the matter, in what would amount to a significant strategic shift by the oil company.
The stock markets in East Asia and Australia are little changed on Friday. Economic worries are overshadowing the strong performance on Wall Street, where prices reached new record highs on Thursday. Investors fear that a new wave of pandemics could end the economic recovery. Fears of further regulatory intervention by China also continue to smoulder in the background. Meanwhile, strong quarterly results from domestic companies supported the Japanese stock market. The Nikkei 225 index gained 0.3 per cent. Olympus rose by 3.3 per cent after the company raised its targets for the current financial year.
The supposed safe haven of US government bonds fell sharply. The weekly labour market data had dampened concerns about a weak jobs report on Friday, it said, with a view to falling bond and gold prices.
IR lowers Siemens Energy target to 25 (27) EUR – Hold
UBS rises Unicredit target to 13,55 (12,70) EUR – Buy
Barclays rises SocGen to Equalw. (Underw.) – Target 23 (19,60) EUR
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